Venables, 27, did not attend the hearing at London's Old Bailey, appearing instead via a videolink from a prison where he has been held since his arrest in February.

Laws protecting his identity are so strict that no-one in court 14 other than the judge, Mr Justice Bean, was allowed to see Venables on the TV screen.

Venables, who was convicted with Robert Thompson of murdering two-year-old James in Liverpool in 1993, has been living under an assumed identity since being released on licence in 2001.

He was charged with downloading 57 indecent photographs of youngsters - some as young as two - between February last year and February this year, and of distributing indecent images on two occasions.

A court heard that images of children having sex were found on Venables's computer when he left it at a police station amid fears that his true identity had been discovered.

He alerted his probation officer who advised him to gather his belongings. However, the 27-year-old was spotted trying to delete files from his computer and remove the hard drive.

He was taken to a police station with the machine and it was later examined by officers.

Eight of the images subsequently found were categorised as level four - the second most serious involving sexual activity with children.

Venables had downloaded them using peer-to-peer software that would have allowed others to access them, the court heard.

At one point he exchanged instant messages with another paedophile Leslie Blanchard from Chelmsford, Essex, posing as a 35-year old mother willing to sell her eight-year-old daughter for sex

He told police he had been sexually excited by the pictures, describing himself as "breaking the last taboo" but insisted he had "no intention" of having sex with young girls.

Venables and Thompson were both aged ten when they led James away from a shopping centre in Liverpool and took him to a nearby railway line where they battered him to death.

When the two killers were released from secure accommodation they were given new identities, protected by a High Court order which prevents the media from disclosing their location, printing up-to-date photographs of them or even describing what they look like now.

Apart from Venables and Thompson, only two other people are protected by such orders; the child killer Mary Bell and Maxine Carr, who helped Ian Huntley cover up the Soham murders.

Venables is the only person with a protected identity to break the law after being released from prison, meaning his appearance in court was a legal first.

The court heard Venables has had further brushes with the law since his release on licence.

In September 2008 he was arrested on suspicion of affray after he and another man became involved in a drunken street fight.

He was given a formal warning by the Probation Service about breaching the good behaviour expected of him as a condition of his licence.

Later the same year he was cautioned for possession of cocaine after he was found with a small amount of the class A drug, which was said to be for personal use.